The problem is that you still need an additional acceleration in order to get into an real orbit. In any theoretical orbit (without an acceleration) you'll always go around in a circular motion until you reach your starting point, if your starting point is in the atmosphere then you'll go around your orbit until you hit your starting point in the atmosphere again. This will obviously cause your orbit to decay. There are a few solutions.

1. Just use a rocket engine. This is the simplest and most practical solution. Vacuum engines are very efficient and you don't need that much fuel.
2. Use a skyhook. This is a giant spinning thing in orbit. Your spaceship "grabs on" to an end of a line and takes momentum from the already orbiting skyhook station in order to get in orbit yourself.
3. You might be able to do something weird with the Moon's gravity in order to change your orbit. This would take a while and you would need a huge velocity from the railgun and your orbit would be very high and probably no circular, but there's no physics reasons it wouldn't work (I think).